Posted at Mar 3, 2020 1:15:00 PM by THAT Agency | Share
Tracking marketing ROI is elusive. Strategies can often take a number of months to take full effect, and agencies course-correct and enhance their tactics regularly. It’s also true that there are a number of elements that are outside the marketing agency’s control (e.g., search engine algorithm changes) that can have an effect on results.
The bottom line: accurately gauging yourdigital marketing return on investment can be a challenge. But it is one well worth tackling so you can direct your budget where it will have the most impact.
Here are a few tips on tracking marketing ROI:
Start with the 5W's and the H
These are the questions you need to ask about your digital marketing return on investment:
Who are we reaching?
What specific metrics do you monitor?
Where are they spending the most time?
When do you measure?
Why are these results good or bad?
How can we amplify ROI next month? Next quarter?
Check Your AVE
Adwords Value Equivalency (AVE) looks to see the difference between how much it would cost for you to purchase your traffic from Google versus how much it costs to work with your marketing agency. The term was coined by David Meerman Scott, who is the author of the book The New Rules of Marketing and PR. In the book, Scott states that if your upfront cost is lower than what it would cost per click from Google, then you’re definitely on the right track in terms of your digital marketing return on investment.
Track your Sales
Tracking sales requires heavy time delegation, but it’s vitally important to track the cost of your generated content against the revenue that you generate from that content.
For example, if you own a travel agency, and you’ve been able to get X number of leads attributed to your marketing agency, you put the value of those leads against what you spent with your agency in order to acquire them, and then run the calculation to help you in tracking marketing ROI.
Drill into Tactics
While it is critical to monitor the overall efficacy of campaigns, investigate each tactic your agency employs. For example, what is your Return on Ad Spend (ROAS) delivering for your social media marketing? By checking social ROAS, you can identify which techniques are bearing fruit and which tactics need to be reconsidered in terms of results and budgeting for the next period.
These are just a handful of techniques for tracking marketing ROI. Remember that any experienced and high-quality digital marketing agency should be more than happy to explain it all to you so that you can easily see if their strategies are working or if you need to change things up to increase leads and sales.
Ultimately, accurately gauging your digital marketing return on investment can be a challenge. But it is one well worth tackling so you can direct your budget where it will have the most impact.
Analyzing your digital marketing return on investment is tricky -- and, unfortunately, it’s not getting any easier. When checking your AVE, tracking sales, and drilling into tactics, you want to make sure that you’re addressing your 5 W’s and the H to find the answers you are looking for and to set new goals.